How can this be? The answer comes from Gerd Gigerenzer's work on "fast and frugal" heuristics, which are like decision-making short-cuts.
In this case, the students used the recognisability of the names presented to them as an indicator of their wealth. They did this intuitively and it turns out to be an effective cue to use. Recognisability does indeed correlate well with wealth - the researchers know this because after the study, they found out which names from the list the students recognised and cross-checked this with the wealth of the people on the Rich List.
But imagine those cases when a student recognises all the names in a given grouping - now their tactic of using recognisability as a cue for wealth is impossible to apply and that's why less knowledge can sometimes be more when it comes to finding the right answer.
Frosch and colleagues' analysis of the students' performance confirmed this. For example, when choosing the richest of four people, students performed better when they knew just one or two of the names compared with when they knew all four. There were similar findings for the poorest question, with students performing better when they recognised two out of three names compared with recognising all three.
The researchers caution that this 'less-is-more' rule to knowledge only applies in certain circumstances. In this case, when the students knew all two, three or four names shown to them, their knowledge about those people tended to be superficial. "A little learning is dangerous thing, but only when learning increases breadth at the expense of depth," the researchers wrote.
Frosch, C.A., Beaman, C.P. & McCloy, R. (2007). A little learning is a dangerous thing: An experimental demonstration of ignorance-driven inference. The Quarterly Journal of Experimental Psychology, 60, 1329-1336.
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